Sugar Water: The Next Big Feedstock?

Feedstock is a critical but costly step in the production of Biofuels & Biochemicals that has imposed as a bottleneck to the entire industry. According to Cleantech Group’s i3 Platform, we have seen increasing investment and partnership activities among multinational corporations with feedstock technology companies in order to develop cheaper sugars. For example, Dupont has invested in and partnered with NexSteppe to develop high biomass sorghum for downstream biofuels and biochemicals production. BASF and Waste Management have also made strategic investments to Renmatix to develop cellulosic sugars. Finally, Syngenta has formed an equity-based technology partnership with Agrivida towards the company’s technology on engineered crop. At Cleantech Group, we continue to see new innovating technologies that aim to solve this bottleneck issue from multiple angles.

Last week, Cleantech Group interviewed Ms. Kef Kasdin, CEO of Proterro, to learn more about the company’s technology innovations and the potential breakthroughs they might bring to the biofuel and biochemical industry.

Proterro, a New Jersey based producer of low-cost sugar feedstock for the biofuels and biochemicals industries, recently received a notice of allowance from the USPTO for a device patent that protects the company’s photobioreactor system. Proterro’s unique photosynthetic sugar-making organism, process, and system devices have already attracted $9 million in growth equity investments from Battelle Ventures, Braemar Energy Ventures, Innovation Valley Partners, Cultivian Ventures, and Middleland Capital. The company has recently started a pilot plant and plans to scale up to demonstration scale next year.

What is unique about Proterro’s technology and what innovation does Proterro bring to the biofuel and biochemical market?

We are the only company that is actually “making” sugar rather than extracting it from crops or deconstructing cellulosic materials. Our company engineered sucrose-producing cyanobacteria to continuously secrete sucrose by simply providing them with carbon dioxide (CO₂), water, and sunlight. This technology enables Proterro to provide pure C6 sugar with no inhibitors that might interfere with downstream production processes. The design of Proterro’s photobioreactor cuts down water use and total production cost by growing microorganisms on solid surface hanging in the photobioreactor instead of in volumes of water. Proterro is targeted to reduce the cost of production to around $0.05 per pound by the time of commercialization, compared to no less than $0.12 per pound currently in the general market. In addition to that, the process would help reduce the carbon footprint in sugar production and could help resolve the conflict of food versus fuel as well.

What is the technology readiness level of Proterro and what would be your next step?

Proterro is currently at its pilot scale. Our greenhouse trial showed our process is 30 times more productive per acre of land than producing from common feedstock such as sugarcane. Right now, Proterro has capacity for up to four photobioreactors at its pilot plant and is expected to scale up to 100 similar photobioreactors in its demonstration plant next year. The company plans to scale up by putting independent photobioreactors in arrays without significantly increasing the size of a single reactor. This modular approach will let Proterro avoid the scale-up hurdles faced by much of the biofuel industry. The ultimate goal for Proterro is to commercialize within several years.

As Proterro is planning to commercialize, what would be its revenue model?

Proterro has considered two revenue models: a licensing model and a joint venture model. It will depend on the partner we speak to. We already have a preliminary design for our demonstration plant and will be seeking funding to make it happen next year.

Ideally, the demonstration plant would be located close to an emitter of CO₂.  It could be connected to an ethanol plant, whose yeast fermentation process gives off CO₂ and would use Proterro’s sucrose.  Another co-location possibility would be a utility plant, which also emits CO₂.

Current biofuel companies are struggling to achieve high profitability due to high production costs. Using fermentation-ready sugar will simplify many upstream feedstock pre-treatment processes, thus reducing operating cost to a large extent. By establishing a sugar production facility near refineries, it creates a win-win situation where both companies will have access to cheaper feedstock, namely CO₂ and sugar, for their production. To meet more innovative companies like Proterro, attend the Cleantech Forum San Francisco on March 11-13 and learn more about how innovative technologies trigger changes across the cleantech landscape.

Wendy is a research intern at the Cleantech Group for the spring term. She supports the research team in identifying innovating cleantech companies and tracking investments for various sectors. Wendy specializes in the Biofuel & Biochemicals and Biomass Generation sectors and is also interested in cleantech development in the Chinese market. Wendy is a Master’s candidate majoring in Bioenergy with a business focus at the University of Illinois at Urbana-Champaign. Previously, she has worked as a student project manager for Illinois Department of Transportation’s (IDOT) right-of-way bioenergy project and interned at the Center of Advanced BioEnergy Research (CABER), a bioenergy research institute at the University of Illinois.